Correlation Between EBEST Investment and DB Financial
Can any of the company-specific risk be diversified away by investing in both EBEST Investment and DB Financial at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining EBEST Investment and DB Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between EBEST Investment Securities and DB Financial Investment, you can compare the effects of market volatilities on EBEST Investment and DB Financial and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in EBEST Investment with a short position of DB Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of EBEST Investment and DB Financial.
Diversification Opportunities for EBEST Investment and DB Financial
-0.17 | Correlation Coefficient |
Good diversification
The 3 months correlation between EBEST and 016610 is -0.17. Overlapping area represents the amount of risk that can be diversified away by holding EBEST Investment Securities and DB Financial Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DB Financial Investment and EBEST Investment is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on EBEST Investment Securities are associated (or correlated) with DB Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DB Financial Investment has no effect on the direction of EBEST Investment i.e., EBEST Investment and DB Financial go up and down completely randomly.
Pair Corralation between EBEST Investment and DB Financial
Assuming the 90 days trading horizon EBEST Investment is expected to generate 69.7 times less return on investment than DB Financial. But when comparing it to its historical volatility, EBEST Investment Securities is 1.08 times less risky than DB Financial. It trades about 0.0 of its potential returns per unit of risk. DB Financial Investment is currently generating about 0.06 of returns per unit of risk over similar time horizon. If you would invest 401,993 in DB Financial Investment on August 29, 2024 and sell it today you would earn a total of 104,007 from holding DB Financial Investment or generate 25.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
EBEST Investment Securities vs. DB Financial Investment
Performance |
| Timeline |
| EBEST Investment Sec |
| DB Financial Investment |
EBEST Investment and DB Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with EBEST Investment and DB Financial
The main advantage of trading using opposite EBEST Investment and DB Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if EBEST Investment position performs unexpectedly, DB Financial can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in DB Financial will offset losses from the drop in DB Financial's long position.| EBEST Investment vs. Cube Entertainment | EBEST Investment vs. Dreamus Company | EBEST Investment vs. LG Energy Solution | EBEST Investment vs. Dongwon System |
| DB Financial vs. Korea Zinc | DB Financial vs. Samsung Fire Marine | DB Financial vs. Kumho Petro Chemical | DB Financial vs. LG Chem |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Economic Indicators module to top statistical indicators that provide insights into how an economy is performing.
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